Christjohn O.

Villaluz
February 20, 2019

Remedy of Persons Aggrieved in Land Registration Proceedings

SERNA VS FONTANILLA
307 SCRA G.R. No. 124605
June 18, 1999

ENRIQUITO SERNA and AMPARO RASCA, petitioners,

vs.
COURT OF APPEALS, SANTIAGO FONTANILLA, and RAFAELA RASING, respondents.

FACTS:

Dionisio Fontanilla had four (4) children, namely, Rosa, Antonio, Jose and Lorenza, all
surnamed Fontanilla. Rosa married Estanislao Pajaro and their union produced Fructoso and
Paciencia. Lorenza married Alberto Rasca and they had a daughter, petitioner Amparo Rasca
(married to Enriquito Serna). Jose had a son, respondent Santiago Fontanilla (married to
Rafaela Rasing). Hence, the parties involved are first cousins.

DIONISIO
FONTANILLA

ROSA ANTONIO JOSE LORENZA

ESTANISLAO PAJARO ALBERTO RASCA

SANTIAGO AMPARO
FRUCTOSO PACIENCIA
FONTANILLA RASCA
RAFAELA RASING ENRIQUITO SERNA

Their grandfather (Dionisio Fontanilla) owns a 12,508 sq.m. land that was surveyed by Turner
Land Surveying Co. for him which he promised to pay for after the approval of Bureau of Lands.
He failed to pay for the costs and to elude foreclosure of the land he sold said land to his
daughter Rosa who assumed payment for the property tax. Rosa subsequently sold the land to
her nephew Santiago Fontanilla, herein respondent, under a notarized deed of sale that was not
registered to the Register of Deeds. Santiago Fontanilla constructed a house and lived there.

On December 16, 1957, Rosa's heirs, Estanislao Pajaro and his two (2) children, Fructoso and
Paciencia, executed another deed of absolute sale over the same land in favor of respondent
Santiago Fontanilla. In 1978 Santiago Fontanilla and his wife (Rafaela Rasing) went to the US
to visit their daughter. While out of the country, petitioners Enriquito Serna and his wife
(Amparao Rasca) applied a land registration of said lot which was successfully registered in
their name on Jan. 10, 1980.

On May 27, 1981, respondents filed an action for reconveyance with damages against
petitioners, and sought the annulment of the issued OCT to the petitioners. Petitioners contend
that when their grandfather (Dionisio Fontanilla) failed to pay the surveying company in 1921,
the company took the property in question but it was redeemed later on and sold to their father
(Alberto Rasca) but they could not produce evidence in court. When her father died, Santiago
Fontanilla borrowed from her mother the deed covering the transfer of the property, which
Santiago did not return.

The trial court as well as the Court of Appeals ruled in favor to the respondents as true owners
of the said lot hence this petition to the S.C.

Doctrine: The general rule is that the "Adjudication of land in a registration (or cadastral) case does not become final
and incontrovertible until the expiration of one (1) year after the entry of the final decree." After the lapse of said
period, the decree becomes incontrovertible and no longer subject to reopening or review.However, the exception is
that the law recognizes the right of a person deprived of land or of any estate or interest therein by adjudication or
confirmation of title obtained by actual fraud. as a valid and legal basis for reopening and revising a decree of
registration. For fraud to justify a review of a decree, it must be extrinsic or collateral, and the facts upon which it is
based have not been controverted or resolved in the case where the judgment sought to be annulled was rendered.
ISSUE:
For the purpose of Land Titles and Deeds, the relevant issue of this case is whether the
decision is in accordance with law and jurisprudence.

That is whether the respondent in this case is allowed in the first place to reopen and revise a
decree of registration after the expiration of the one (1) year period where the entry of the
decree becomes final and incontrovertible.

HELD:
The petition was denied for lack of merit, the decision of the lower court and that of the court of
appeals was affirmed

At the time material hereto, registration of untitled land was pursuant to Act No. 496, as
amended. Later, Presidential Decree 1529, the Property Registration Decree, amended and
codified laws relative to registration of property.

Provides, "Adjudication of land in a registration (or cadastral) case does not become final and
incontrovertible until the expiration of one (1) year after the entry of the final decree."
After the lapse of said period, the decree becomes incontrovertible and no longer subject to
reopening or review.

HOWEVER, the right of a person deprived of land or of any estate or interest therein by
adjudication or confirmation of title obtained by actual fraud is recognized by law as a valid and
legal basis for reopening and revising a decree of registration.

The fraud contemplated by the law is actual and extrinsic fraud, which includes an intentional
omission of a fact required by law. For fraud to justify a review of a decree, it must be extrinsic
or collateral, and the facts upon which it is based have not been controverted or resolved in the
case where the judgment sought to be annulled was rendered. Persons who were fraudulently
deprived of their opportunity to be heard in the original registration case are entitled to a review
of a decree of registration.
"An action based on implied or constructive trust prescribes in ten (10) years. This means that
petitioners should have enforced the trust within ten (10) years from the time of its creation or
upon the alleged fraudulent registration of the property." Discovery of the fraud must be deemed
to have taken place from the issuance of the certificate of title "because registration of real
property is considered a "constructive notice to all persons" and it shall be counted "from the
time of such registering, filing or entering."

REASON:
In the present case, respondents came to know of the fraud in securing title to the land
sometime after its registration, however, an innocent purchaser for value had not acquired the
property. Extrinsic fraud attended the application for the land registration. It was filed when
respondents were out of the country and they had no way of finding out that petitioners applied
for a title under their name.

Fortunately, respondents' action for reconveyance was timely, as it was filed within ten (10)
years from the issuance of the Torrens title over the property.

Doctrine: The general rule is that the "Adjudication of land in a registration (or cadastral) case does not become final
and incontrovertible until the expiration of one (1) year after the entry of the final decree." After the lapse of said
period, the decree becomes incontrovertible and no longer subject to reopening or review.However, the exception is
that the law recognizes the right of a person deprived of land or of any estate or interest therein by adjudication or
confirmation of title obtained by actual fraud. as a valid and legal basis for reopening and revising a decree of
registration. For fraud to justify a review of a decree, it must be extrinsic or collateral, and the facts upon which it is
based have not been controverted or resolved in the case where the judgment sought to be annulled was rendered.